TRIPOLI/BENGHAZI (Reuters) - The leaders of France and Britain were feted in Libya for their support of the uprising which overthrew Muammar Gaddafi while forces of the new government closed in on his hometown Sirte in an effort to complete their victory.

French President Nicolas Sarkozy and British Prime Minister David Cameron, whose air forces helped end Gaddafi's 42-year rule, flew in to Tripoli to be told their support may be repaid in business contracts with the oil-rich North African state.

Fighters loyal to the interim National Transitional Council (NTC) meanwhile attacked Gaddafi's birthplace Sirte, 450 km east of Tripoli on the Mediterranean coast, facing determined resistance from forces still defending the ousted leader.

"They have now entered the city. There was a coordinated push from the south, east and west and from along the coast. I'm not sure how far they have been able to enter," NTC military spokesman Abdulrahman Busin said.

"They are coming under heavy fire. There is a particular problem with snipers."

After nearly seven months of fighting, NTC forces backed by NATO air power control most of Libya, including oil-producing centers and the capital Tripoli, which they seized last month.

They have met fierce resistance in a handful of pro-Gaddafi bastions such as Sirte, the desert town of Bani Walid and southern outpost of Sabha.

Gaddafi, wanted by the International Criminal Court, has also gone into hiding and is rumoured to be hiding in one of the loyalist strongholds.

LIBERTY, EQUALITY AND FRATERNITY?

In Benghazi, seat of the uprising which early intervention by French and British jets helped to save from Gaddafi's army in March, Sarkozy and Cameron were treated to a rowdy welcome on Freedom Square, shouting to be heard over a cheering crowd.

"It's great to be here in free Benghazi and in free Libya," said Cameron as he strained to be heard above the chants in scenes from the former rebel stronghold televised live across the globe.

The French president, struggling for re-election next year, beamed at grateful chants of "One, two, three; Merci Sarkozy!" while the two leaders, flanking NTC chairman Mustafa Abdel Jalil, held his arms aloft like a victorious boxer.

"France, Great Britain, Europe, will always stand by the side of the Libyan people," said Sarkozy, whom many Libyans credit with making a decisive gamble, pulling in a hesitant United States and securing U.N. backing for NATO air strikes to halt Gaddafi's tanks as they closed in to crush Benghazi.

"Your city was an inspiration to the world as you threw off a dictator and chose freedom," Cameron said. "Colonel Gaddafi said he would hunt you down like rats but you showed the courage of lions."

Hajja, a 70-year-old swathed in the rebel tricolour, watched the two leaders with a rapture they rarely experience at home: "If we could give them anything, we would -- our lives, our souls ... But for them, we would be history."

SUPPORT OFFERED

In Tripoli, Libyan interim premier Mahmoud Jibril spoke at a news conference of "our thanks for this historic stance" taken by France and Britain to launch the West into a war that did not always look set to end well for the rebels.